Revenues: $8.2 billion in the third quarter.
Net income: $972 million in the third quarter.
Declaration on after-tax income: 11.8%.
PACCAR Parts Revenue: Increased 5% to $1.66 billion.
PACCAR Parts’ gross margin: 30.1% in the third quarter.
Pre-tax income (PACCAR Financial): $107 million in the third quarter.
Truck deliveries: 44,900 trucks in the third quarter. The number is expected to rise to 42,000 in the fourth quarter.
Net income (first 9 months): $3.3 billion.
Operating cash flow (first 9 months): $3.2 billion.
Return on invested capital: 25% for the first 9 months.
Capital Expenditures (2024): Expected to be $760 million to $800 million.
Research and development expenses (2024): $450 million to $470 million.
Release date: October 22, 2024
For a complete record of financial statements, see Complete Record of Financial Statements.
PACCAR Inc (NASDAQ:PCAR) reported strong financial results with net income of $972 million on sales of $8.2 billion, delivering an industry-leading after-tax return of 11.8%.
PACCAR Parts’ third quarter sales increased 5% to $1.66 billion and pre-tax income was $407 million, demonstrating strong performance for the parts division.
The company increased its Class 8 market share in the U.S. and Canada from 29.5% to 31.1%, demonstrating its competitiveness in the heavy-duty truck market.
PACCAR Inc (NASDAQ:PCAR) is expanding its manufacturing capabilities in Europe, the United States, Mexico, Brazil and Australia to support future growth and customer success.
The company is the first manufacturer in California to have engines certified for the upcoming emissions standards, placing it well-positioned for future regulatory changes.
PACCAR Inc (NASDAQ:PCAR) saw its gross margin decline sequentially due to increased costs and supplier-related constraints.
The used truck market remains sluggish in Europe, which could impact PACCAR Financial’s performance in the region.
There are concerns that competitors may need to adjust their inventory levels, creating potential price pressure and influencing market trends.
The company is facing challenges with reduced production days in North America due to supplier-related restrictions and holidays, impacting delivery times in the fourth quarter.
PACCAR Inc (NASDAQ:PCAR) expects the U.S. and Canadian Class 8 market to fall in the range of 250,000 to 280,000 units next year, compared to 260,000 units this year.
Q: Can you provide some insight into pricing trends and expectations for the fourth quarter? A: Prices were flat in the third quarter, with costs around 3%. The vocational training market is expected to remain strong, and the truckload sector appears to be stabilizing, which could have a positive impact on price/cost over the coming months and next year. – R. Veit, Chief Executive Officer
story continues
Q: How should we interpret the fourth quarter gross margin guidance and its impact on 2025? A: Fourth quarter gross margin is expected to be between 15.5% and 16%. We expect this year to start off as if it were coming to an end, then accelerate, hinting at potential growth next year. – R. Veit, Chief Executive Officer
Q: What are the factors contributing to the sequential decline in gross profit margin? A: The sequential increase in gross profit margin is primarily due to cost factors such as supplier issues and other operating costs. However, our product introductions have been well received and customer demand remains strong. – R. Veit, Chief Executive Officer
Q: Can you talk about the potential impact on inventory levels and pricing? A: Our inventory is at a healthy 2.9 months, which is comfortable for us. This is down from 3.3 months at the end of June, and we do not anticipate that significant inventory reductions will be necessary. – R. Veit, Chief Executive Officer
Q: What is the outlook for the European market and production plans for next year? A: European sales volumes have been affected by the economic slowdown in Central and Eastern Europe. The company plans to maintain price discipline for its new truck products while producing to meet next year’s demand. – Harry Schippers, President and Chief Financial Officer
For a complete record of financial statements, see Complete Record of Financial Statements.
This article first appeared on GuruFocus.
